Greetings, and welcome to the Leggett & Platt Fourth Quarter 2022 Conference Call. At this time, all participants are in a listen-only mode. A brief question-and-answer session will follow the formal presentation. [Operator Instructions] As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Susan McCoy, Senior Vice President of Investor Relations. Thank you. You may begin.

Good morning, and thank you for taking part in Leggett Platt's Fourth Quarter Conference Call. On the call today are Mitch Dollof, President and CEO; Jeff Tate, Executive Vice President and CFO; Steve Henderson, Executive Vice President and President of the Specialized Products and Furniture, Flooring and Textile Products segments; Tyson Hagale, Senior Vice President and President of the Bedding Products segment; and Cassie Branscum, Senior Director of IR. The agenda for our call this morning is as follows: Mitch will start with a summary of the main points we made in yesterday's press release and discuss operating results and demand trends. Jeff will cover financial details and address our outlook for 2023 and the group will answer any questions you have. This conference call is being recorded for Leggett & Platt and is copyrighted material. This call may not be transcribed, recorded or broadcast without our expressed permission. A replay is available from the IR portion of Leggett’s website. We posted to the IR portion of Leggett's – of the website yesterday’s press release and a set of PowerPoint slides that contain summary financial information, along with segment details. Those documents supplement the information we discuss on this call, including non-GAAP reconciliations. I need to remind you that remarks today concerning future expectations, events, objectives, strategies, trends or results constitute forward-looking statements. Actual results or events may differ materially due to a number of risks and uncertainties, and the company undertakes no obligation to update or revise these statements. For a summary of these risk factors and additional information, please refer to yesterday’s press release in the sections in our most recent 10-K and subsequent 10-Q entitled Risk Factors and Forward-Looking Statements. I’ll now turn the call over to Mitch.

Good morning and thank you for participating in our fourth quarter call. Leggett & Platt diverse portfolio of businesses, strong cash discipline and the ingenuity and agility of our employees helped us deliver solid results in 2022 despite weak demand in residential end markets. Sales grew 1% in 2022 to a record from continuing operations of $5.15 billion, primarily from acquisitions. Organic sales were flat, with volume declines of 7% and negative currency impact of 2%, offset by raw material-related selling price increases of 9%. Acquisitions, net of divestitures, added 1% to sales growth. Volume declines were driven by demand softness in residential end markets, partially offset by growth in automotive and industrial end markets. 2022 EBIT was $485 million, a decrease of $111 million versus 2021 EBIT and a decrease of $83 million versus 2021 adjusted EBIT, primarily from lower volume, lower overhead absorption from reduced production, operational inefficiencies in specialty foam, and higher raw material and transportation costs and operational inefficiencies in automotive. These decreases were partially offset by metal margin expansion in our Steel Rod business and pricing discipline in the Furniture, Flooring and Textile Products segment. EBIT margin was 9.4%, down from 2021's EBIT margin of 11.7% and adjusted EBIT margin of 11.2%. Earnings per share in 2022 was $2.27, a decrease of 23% versus EPS of $2.94 in 2021 and a decrease of 18% versus adjusted EPS of $2.78. Cash flow from operations was $441 million, a 63% increase versus 2021. The current global macroeconomic environment and its impact on the consumer negatively impacted our fourth quarter results. Sales were $1.2 billion, EBIT was $91 million, and earnings per share was $0.39. Sales in the quarter were down 10% versus fourth quarter 2021, primarily from lower volume and currency impact, partially offset by raw material-related…

Thank you, Mitch and good morning everyone. In 2022, we generated cash from operations of $441 million, $170 million higher than the $271 million we generated in 2021. This large increase reflects a much smaller use of cash for working capital, partially offset by lower earnings. Working capital increased significantly in 2021 due to restocking efforts following inventory depletion in 2020, but increased to a much lesser extent in 2022 as we return to inventory levels more reflective of current demand. This improvement was partially offset by a decrease in accounts payable as purchases slowed due to lower volume and our efforts to reduce inventory levels. We ended the year with adjusted working capital as a percentage of annualized sales of 15.3%. Cash from operations is expected to be $450 million to $500 million in 2023 as we continue to focus on optimizing working capital in a softer macroeconomic environment. Our long-term priorities for use of cash are consistent and unchanged. They include an order priority, funding organic growth, paying dividends funding strategic acquisitions and share repurchases with available cash. Total capital expenditures in 2022 were $100 million, reflecting a balance of investing for the future while controlling our spending. We raised our annual dividend for the 51st consecutive year in 2022, honoring our ongoing commitment to return value to our shareholders. In November, our Board of Directors declared a quarterly dividend of $0.44 per share, $0.02 or 5% higher than last year's fourth quarter dividend. At an annual indicated dividend of $1.76, the yield is 4.7% based upon Friday's closing price, one of the highest among the dividend kings. We used $83 million during the year for the four strategic acquisitions that Mitch discussed earlier. With the deleveraging we accomplished over the past few years, share repurchases returned as…

That concludes our prepared remarks. We thank you for your attention, and we'll be glad to answer your questions. Operator, we're ready to begin the Q&A session.

Thank you. We will now be conducting a question-and-answer session. [Operator Instructions] One Our first questions come from the line of Susan Maklari with Goldman Sachs. Please proceed with your question.

Thank you. Good morning everyone.

Good morning Susan.

My question is -- and thank you for all the details in the prepared comments, I think it was very helpful. When you think about the efforts in Specialty Foam and you walk through some of those changes that you're making, can you give us a sense of where you are within that process? And how we should be thinking about the benefits of that starting to flow through to the results perhaps later this year, or is it something that will be more of a 2024 event?

Yes, that's a great question, Susan, and thanks for listening in on the comments. I know it was long, but we wanted to try and provide some clarification there. Tyson, I'll let you comment on ECS. I know you've been working really diligently with the team there to assess where we are and put some recovery plans in place.

Sure, thanks and, good morning Susan. I'll start with the commercial side of our plans. As was noted in the prerecorded remarks, it's tough in a slow demand environment, especially where we've weighted our business historically, but our commercial team has done a really good job even in the slow environment building our commercial pipeline and looking at opportunities to diversify our customer base. So despite some near-term headwinds just with the overall market slowness, I feel good about our pipeline there. And especially, because we're able to really return and our customers are interested in returning to looking at some of our specialty foam technologies. When chemicals got really short, our development team really had to pivot and spend more of their time and resources working on formulations just to make sure we could continue servicing our customers. But as those have improved as our constraints have eased and our customers have returned to looking at differentiation and other new product introductions, we've been able to get back to that as well. So I feel good about our pipeline, both from the quality of leads and opportunities that we have, and those are developing throughout the year. We'll start to see some of the benefits in the back half of the year, I think, from some of the business were being awarded. But still, overall, with slow demand and the full benefit probably coming into next year, but also the fact that we're using our specialty phone technologies as part of those projects as well. So, on the commercial side of things, that's how we feel about it. The operations, which we've mentioned as well, working through challenges there, I feel good about the team that's being put together both from the team that came along with the acquisition…

Yeah. No, that's very helpful. Thank you. And I guess following up on that, as we do think about the outlook that you gave us for 2023, especially as it does relate to some of the different parts of the bedding business. How are you thinking about the cadence of the margins in that segment for this year? When you think about normal seasonality on top of some of these company-specific dynamics that are coming through, any thoughts on how we should be thinking about where that margin eventually gets to and the path of getting from where we are today to that endpoint?

Susan, Cassie, do you have any detail there that you'd like to share? I think for us, the biggest – one of the biggest impact is what happens from a scratch or rod spread. And it's really difficult to precisely predict that we have anticipated some contraction over the course of the year. That's probably that in volume would be the biggest impact.

Okay.

And also just one more comment. Yes, we do see the market returning to more normal seasonal patterns. And also, we talked about this before as well. But over the course of the last year, as demand was soft, but we were also really intentional about bringing down our inventory. Our production was below even the demand level so that we could control that, which is tough to do in a slow demand environment, but our team really did a good job in pushing that through reason towards the end of the year. So, I think even as we get back to this year and more seasonal patterns, we should be back to a place we're producing and have better overhead recovery. So, that was a real challenge for us over the last year.

Yes, particularly at the end of the year. I think that's a great point, Tyson. So, if we looked at the first half of the year, call it, or even a little longer, we had really strong trade rod volume, right? And now we're anticipating that to be a little bit lower than last year, but pretty similar, but much more consistent, right, as opposed to the big -- high levels we had the first part of the year and lower in the last half of the year. And then similarly, as you said, with just overall production being more similar. So, I think it would just be a bit more normalized hopefully than what we saw last year.

Okay, Susan that’s very helpful. Yes. Susan a little bit specific on your margin question. We talked about lower first quarter expectations for the company overall that holds true with bedding with a return to more seasonal patterns as we move through the year. So, that all helps treat bedding with, again, their historically highest seasonal quarter has been third quarter. So, a step-up in margins as we move through the year from a margin percentage perspective, what we're showing.

Okay. Okay. That's very helpful. I'll get back in the queue. Thank you.

Thank you. Our next questions come from the line of Keith Hughes with Truist Securities. Please proceed with your questions.

Thank you. I guess you had indicated the slow start to the year in the first quarter. Are you still planning to see Rod Production curtailments into the first quarter? Is that playing a role?

Good morning Keith, good question. Tyson, I'll let you handle that one.

Sure. Good morning Keith. Yes, really Keith that’s something at this point we're playing really throughout the year. As we got into the back half of 2022 and we saw trade demand slow, we had to take more aggressive actions in the back half year. So, it was really heavily weighted towards the third and fourth quarter and pulling our production down, especially in the fourth quarter. So, overall, through the course of this year, we expect things to be relatively consistent from a total production standpoint but more evenly balanced throughout the year.

So, Tyson, if we looked at it from sequentially from the fourth quarter 2022 to the first quarter of 2023, we would see increased production. But if we looked at it year-over-year, we see significantly lower production because it was so strong in Q1 in 2022. Is that right way to think about it?

I think that's the right way to think about it.

Okay. And so if that's the case, I'm a little confused with why the EPS is going to be so much lower, another seasonal change always seasonally, your EPS comes down from the first, given the seasonality in the business. But it seems like some higher production would be offsetting that. Is -- are you assuming the metal margin steps down a lot in the first quarter?

Versus last year, we're starting to expect -- well, we are expecting and experiencing some modest decline in overall metal margin, especially compared to the first part of last year when the conflict in Ukraine, and just overall market capacity constraints really drove things up higher in the first part of the year. So it's overall relatively modest, but still less than the first half of last year, when we look at our production and metal margin.

Okay. And are you assuming for the guidance for 2023, are you assuming those metal margins deteriorate all through the year? And kind of what do they end up at the end of the year?

Sure. So through the course of the year, we have some modest compression. It's really hard to predict. It's been especially difficult over the last couple of years. But for the full year, yes, it's down modestly as we move through the year. And if we looked at the year in total, so 2023 versus 2022 on a percentage basis, we would expect right now that all margin to be down in the mid-teens.

Down mid-teens. Okay. Is there more of an emphasis in the second half of the year on that?

Slightly more, but still relatively consistent as we get through the back half of the year.

Okay.

And to get a little deeper here, I should. But in the first – I guess, probably three quarters, we saw metal markets continuing to expand and then in the fourth quarter contracted a little bit like.

10 percentage in the fourth quarter.

Exactly. So that was tanking, that's just moderating.

That's right. And fourth quarter was a little difficult an indicator just because I think the overall steel market was soft as people got to end of the year, and there was quite a bit of uncertainty. People bringing inventory or consumers bringing inventories down, might be a little tough to predict, especially as we started off 2023, scrap has been a little higher in demand. Prices have been going up, conversion costs remain high. So, it's still pretty dynamic and trying to predict, but that's right, Mitch.

So one final question, sorry to pass the call here. But – so particularly at the low end of the range, it's a pretty substantial reduction in EPS from what we saw – if you had to kind of list one, two, three, the biggest drivers for that, what would those be for the reduction?

Susan, Cassie, you guys want to take that?

Keith, as always, volume is the driver we're trying to predict what's happening with metal margin and frankly, nobody knows that. So we have our assumption built into the forecast. But if it drops more than we're expecting, then that's also meaningful downsize.

So number one would be volume and then things like metal margin and maybe some deflation would be secondary drivers. Is that a fair statement?

Yes, that's a fair statement. It definitely leads with volume. That's where probably the greatest amount of uncertainty exists in this environment. And it could be up, it could be down. That's why we've got such a wide range.

Okay. All right. Thanks very much.

Thank you, Keith.

Thank you. Our next questions come from the line of Bobby Griffin with Raymond James. Please proceed with your questions.

Good morning, everybody. Thanks for taking my questions. I appreciate the detail there on the metal margins. Always hard to predict, but helpful to know what the underlying assumption is in the guidance. I guess, first, Mitch, I wanted to ask about specialized products and where you guys are in the journey of the cost recovery and kind of what's embedded for 2023. I was admittedly a little surprised to kind of see them step back down sequentially despite a little bit better volume sequentially. But I understand that there is a lot moving around inside that segment. So, maybe just kind of given how each business is recovering at a different rate. Can you talk about what the drivers would be kind of for those margins in 2023 and where you and the company are on the journey of trying to get back the very high margins that you guys used to be able to do in those businesses?

Sure. Good morning Bobby. And Steve, I'll make a few comments, but then invite you to join in as well. So, yes, it is a little bit dynamic for sure. We continue to see strong volume gains and specialized across all three of the businesses and expect those to continue as we go into 2023. We definitely had some impacts in the fourth quarter and particularly in automotive, we had a little bit higher material costs, as you mentioned, we've been working on those, but also some labor inflation, particularly where we had increased overtime premiums in China when the COVID restrictions were lifted. And then there is the large outbreak there that certainly impacted us like the rest of the country pretty much. And we surge in our employees who were -- had to be -- had not come to work, and so that led to additional overtime for some of those. So, that was a bit of a one-off there. I would say in automotive overall, I don't want to go in too much detail here, but we continue to make good progress in the pricing recovery, the cost recovery. I'd say that we got about 60% to 65% of it recovered with the balance we expect to come in 2023. We've talked about that it's a challenging thing to accomplish. The team has done a great job, and we're confident in our ability to close that. But we have made really good progress there. From the outlook for production in automotive see the major markets forecast to be about 3.6% year-over-year, which is good, continued progress. It continues to be dynamic, right? There's supply chain labor shortages throughout the supply chain at the OEM level as well, but making progress, continue to see really low inventories and vehicles age rates at very high levels that were around 12 years or so in the US. So, I think that outlook is good. We see that kind of 3% to 4% growth forecasted for the next three years to 2023 to 2025. But I would just remind to the folks that if we look at the forecast for major market production in 2023 is about 70 million vehicles just below that, improving back in 2019, which is actually a down year, it's still $75 million. So, we're still below where we were pre pandemic. But I think what it does provide is a long-term tailwind for the recovery in the automotive market. I think we've seen the really strong backlogs in Hydraulic Cylinders, and that's, I think, a strong benefit for our business there. We also see strong demand in Aerospace, although it's hard to start anything up really fast, especially with the long time lead-times that we see there. But I think those tailwinds and the outlook for all three of those businesses is very positive for us. Steve, let me pause my rambling there and let you chime in as well.

Good morning Bobby. I think, Mitch, you hit most of it. In Hydraulics, we have seen orders continue to increase as the OEMs recover their production challenges, and we expect that to continue through the year. And as Mitch said, we're hopeful that, that will carry on into the second half of the year. we did have a few operational challenges that the team has done a really good job of dealing with. So, looking for continued growth there in aerospace, air travel continues to recover. We don't see business travel recovering until 2025. So, there's still some tailwinds there, kind of, as Mitch has alluded to, the operation performance across the supply chain, it's kind of similar to automotive as they look to ramp back up and we're seeing the same types of order changes and cancellations, short lead times and other things that are making it really challenging to respond, but the long-term fundamentals are definitely there for continued growth in Aerospace.

Thank you. I appreciate the detail. And Mitch, maybe on CapEx, just thinking out a little further, is there a catch-up period that's going to have to come on capital spending? And I guess I'm just asking in the context that I think pre-COVID, this was $140 million to $150 million a year CapEx business, at least in 2019. And we're not going on two years of just $100 million, and it's running well below D&A. So as the business has changed, where the capital requirements are just not as much, or is there going to be kind of a catch-up period here if the economy improves, that we have to kind of spend a little bit more on the capital side?

Yeah, that's a great question, Bobby. Thanks for asking that. I don't see that, there's a big catch-up. We haven't been constraining any kind of critical investment. In fact, we've had some things like, for example, IT that we've had to increase our investment and we think that those are critical to do. We continue to do so. I think historically, the biggest use of CapEx comes in bedding US Spring historically as well. I think we've done a good job of managing that a little bit differently. Not that, we don't invest in capacity or in innovation. We'll continue to do so, but we think we can do that a little bit more efficiently. And then the second one would be in automotive. And I think part of the impact there has been with all the volatility there's been just less new programs starting and so some of that has been pushed out as well. So but it's not like it's going to get pushed out. It's just going to change the whole time frame. So you don't get double the investment in one year. It's just going to change the time frame a little bit. So I think we probably will as we get back to stronger growth environment, increase our CapEx, but I don't see any big catch-up or big surge that will negatively impact us.

Thank you. I appreciate the details and best of luck.

Thanks, Bobby.

Thank you. [Operator Instructions] Our next question is come from the line of Peter Keith with Piper Sandler. Please proceed with your question.

Good morning. This is Matt Egger on for Peter. Thanks for taking our question. First off for me, we're just curious what happens to gross profit dollars if we see commodity led price decreases? And maybe you can compare to what you would expect to see now versus what historically happened with the Leggett accounting change? That's my first one.

Okay. Thanks. Good question. And I'll take the easy part of it and then turn it over to Susan or Cassie, for the LIFO piece. But I think in general, we've talked about as inflation has occurred throughout the last couple of years that we can be successful in passing it on, but largely passing on the dollar amounts, right, for the most part. And so that's had a drag on our margin. So I think as we see deflation, and we pass that along to our customers. We see that same dollar change, but we shouldn't see a big impact in our margin profile. There's some pluses and minuses. Some of that is timing around what kind of inventory we have. And for the most part, we're in very good shape. They don't have a lot of high-cost inventory and sometimes timing around how it moves through our spin or how contractual agreements work. But overall, I think it should stand up to reflect what we've been commenting on we've passed on the inflation that we've done that largely on a dollar basis, and we expect to see the same thing as we see a little bit of deflation as well. Susan, Cassie, anything you would add to that, particularly on the--?

Yes. LIFO is our favorite topic. It's actually directionally very predictable in an inflationary environment. LIFO will, without fail, generate expense in the deflationary environment as predictably, it would generate a benefit. So, that's just high level, what to expect. And thankfully, we don't have to deal with that anymore.

Great. Thanks. And then secondly, can you walk us through the Furniture segment and maybe explain why the year-over-year volumes in Furniture are starting to kind of chop off.

Yes, sure. Steve, I'll ask you to jump in there. But it's really a couple of dynamics. I mean we have to -- after a big surge in Home Furniture that we saw over last year and in the beginning of this year, we really saw that soften across the industry. That's not -- shouldn't really be new news. And then if we look at Work Furniture, that is probably the change where after being so soft, we saw a strong recovery in the first three quarters of 2022 and then really started to see the contract business, which had been recovering slowdown in the fourth quarter. So, that's been the biggest change there. But Steve, I'll let you chime in as well.

Yes, thanks good morning. Yes, from a Home Furniture perspective, the answer is much, much lower retail demand. So, we had seen the low end drop, but then we saw the mid and high price points drop even further than what we expected. And that's led to some fairly significant inventory levels, which we couldn't see earlier in 2022, and we expect those to be worked off here hopefully in the first half of 2023 and start to return to a more normalized demand level. And from a Work Furniture perspective, as Mitch said, our customers are reporting volume declines and incoming contract orders. And that's really driven by the surge of back to office that they saw and that's worked its way through, and now they're seeing a little bit more lower level of return to office trends, particularly in the Americas, which is lowering that demand. And then you can add on top of that the retail residential slowdown that we spoke to from a Home Furniture perspective. So, those are the two big issues that are impacting Work Furniture at this point in time.

Yes. Steve, if I remember right, this forecast, which would be for North America was down about 8% or so for this year.

Yes, 8% or 9%.

Yes, yes. So in line with industry dynamics there, unfortunately. And as we've mentioned before, so the fabric converting side of our Textiles business also moves along largely with Bedding and Home Furniture. So, we see that down. But what does not is the geo textiles component side of that, and we see that driven by industry to be -- continue to be strong as we go into 2023.

Great. Thank you all.

Thank you.

Thank you. Our next questions come from the line of Susan Maklari with Goldman Sachs. Please proceed with your question.

Thank you. My first question is on input costs. And we've touched a bit on this across the questions. But can you give us a sense of what you're actually seeing in the various inputs, maybe upside, especially of the metal margins? And how you're thinking about the puts and takes there for 2023?

Yeah, I'll make a general comment and then tie to Steve asked you to join it. But Susan, I think that we see inflation moderating. Maybe in some things, we see a little bit of deflation kicking in. but we don't see any really significant declines across the board, in fact, really anywhere that I can think of. And so I think it remains – I think for the large part, commodity costs are – remain at elevated levels are generally neutralizing or starting to come down a little bit, but we just don't see huge, huge declines, but Tyson, anything different you'd see in chemicals or anything?

Mostly the same as what you just said, Mitch, we talked quite a little bit about metal margins. But part of the reason why that's been difficult to predict is because our conversion costs, not just the scrap input cost, but the cost of everything else that goes to converting that into rod, energy costs, the consumables in re-fractories and electrodes and everything else. Those have increased significantly as well. So when all of those input items even go into our overall costs are increasing as well, it becomes difficult to predict. But overall, I agree with what you said, Mitch, the some general moderation in some of those costs. On chemicals, we've seen some of that as well. some moderation but not dropping off a cliff because of a lot of the same issues, energy costs being high, there's still global constraints around certain types of chemicals and just overall capacity in the market to produce still makes it difficult to see exactly where those will land, but it's been relatively stable.

Yeah. Okay. Thanks. And Steve, I think that holds up pretty much across specialized that we don't see a lot of change there. Maybe in Flooring & Textile can be a little bit more dynamic, but anything that you would add?

No. I would just say most of the inputs are stabilizing, but we have seen relatively few signs of deflation outside of certain types of steel, but like Tyson said, resins, chemicals or other things remain at an elevated level. There's a lot of talk of them coming down, but we haven't seen that turn into reality at this point.

Okay. And then I have one more, which is on the cash flow side of things. Can you talk about the ability to generate cash this year even when we think about the EPS guide that you have put out there? And maybe just any commentary on some of the uses of that cash, you did several small acquisitions in 2022? How is that pipeline coming together? And perhaps how you think about the opportunities there or other uses of the money?

Yeah. Sure. That's a great question, Susan. And Jeff, I'll chime in the first and then ask you to come in on the uses. But Susan, I feel really confident about our cash flow generation. You saw us this year. And I think even though we see a lot of our businesses, volume levels low, I think we feel a little bit more stability as we talked about with inflation and things like that. So we've done – the team has done an incredible job managing our working capital, in particular, as we – even as the pandemic hit in the first part of the crisis, it just improving our receivables management, and we continue to maintain that in a really, really good spot. We talked about how we work through the second half of the year, particularly in the fourth quarter to bring down inventory levels, to align with the slower demand and taking they can – a lot of time out of the rod mill was painful from a margin standpoint, but it certainly got us to the right place in our cash flow and from an inventory standpoint. So we're starting in a really good position there. And then I think hopefully a little bit less volatile arena, it will be a little bit easier to manage that working capital. So, I suspect inventory, especially. So, I expect to see less volatility there. And then the other thing you probably noticed is that our payables were down significantly as we ended the year and not surprising, right, as we're taking down inventory, we're buying less. So, I think from a working capital standpoint, we're in a very good position to manage that. While we wish we had more volume, they'll continue to drive cash through the company. And Jeff mentioned our CapEx, we expect it to be pretty consistent with where we were in 2022. So, I don't think we have any big plans for acquisitions at this time or share repurchases continue to focus on funding the dividend. And Jeff, let me turn it over to you anything that I missed.

Thanks Mitch and good morning Susan. Just a couple of other comments I would make. Susan, as you look at the company's history of operating cash flow and the ability to have that operating cash flow exceed our CapEx spend as well as our dividend support, we have been able to exceed that 33 out of the past 34 years with the one year that we did not was when we needed to replenish the inventory, which we talked about earlier in 2021. So, we've got a strong trend of being able to demonstrate that ability to do so. And as Mitch mentioned earlier, on the CapEx side, we feel reasonably comfortable there with the $100 million that we're guiding towards. In terms of our acquisitions, we spent $83 million in 2022 on acquisitions. You can expect that number to be lower in 2023, and we spent $60 million in 2022 on share repurchases. And you can definitely expect that number to be lower in 2023 as well. So, as we discussed in the prepared remarks, definitely minimal participation in activity around share repurchases as well as M&A activity for the upcoming year.

Okay. Thank you very much, and good luck.

Thank you.

Thanks Susan.

Thank you. there are no further questions at this time, I would now like to turn the floor back over to Susan McCoy for any closing comments.

Thank you for joining us today. We'll speak to you again on May 2nd after we report first quarter results. If you have questions, please contact us using the information in yesterday's press release. Thank you.

Thank you. This does conclude today's teleconference. You may disconnect your lines at this time. Thank you for your participation and enjoy the rest of your day.